The graph above is taken from the recently published report by Shelter. It shows the parlous state of social house building since 1923. I've written quite a lot about housing on this blog but this report makes it clear that things are as bad as ever.
From the Second World War up to 1980, we were building an average of around 126,000 social homes every year. Last year, there were only 6,463 new social homes.
...
If we continue as we are, only half of today’s young people are likely to ever own their own home – and a generation of younger people and many who are retired will spend their lives struggling with insecure, expensive renting. Over the next twenty years, hundreds of thousands more people will be forced into homelessness by insecure tenancies and sky-high housing costs.
We can't afford to continue as we are. The collapse of social housing began with the Right to Buy enshrined in the 1980 Housing Act but has continued through successive governments of both main parties and during the coalition period. The ballooning welfare bill is not down to the recipients of housing benefit, Universal Credit or any of the other myriad forms of support available, in theory anyway, to those who can navigate the bureaucracy. It is because those successive governments have simply ignored the problem, the Tories giving way to nimbyism while Labour targeted Tory voters by shifting right and embracing Thatcherism.
According to the background research for the report (pdf):
- We estimate that public expenditure on housing in England was £26.8 billion pounds in 2016-17.
- Public spending on housing has lagged behind expenditure on other public services over the past twenty years and the focus of spending has increasingly been on housing benefits rather than investment in new social or affordable housing.
- Real terms housing benefits payments in England have been on a long-term upwards trend, more than doubling since the start of the 1990s. The increase is mainly due to rising housing benefit payments per caseload as real terms rents for all tenures have increased. However, an increased reliance on private rented sector tenures has also raised the housing benefit bill and the cost in rents to tenants.
- Reduced investment has lowered the number of additional social rent homes being delivered each year. Social rent housing additions have fallen by 79 per cent since the first half of the 1990s.
- Grant funding for social housing has been limited since 2011. Instead, the focus has predominantly been on making funds available for affordable rent homes or the Help to Buy equity loan scheme.
In another background paper, Shelter provides estimates of existing unmet need for housing:
Homeless in temporary accommodation |
79,900 |
Rough sleeping and hidden homelessness |
128,000 |
Overcrowded |
240,000 |
Living with poor conditions in the PRS |
631,000 |
Ill health/disability |
194,000 |
TOTAL |
1,272,900 |
On top of that they estimate a need for a further 1.2 million homes to address the anticipated increase in existing and newly forming lower income young households who are not expected to be able to afford home ownership in their lifetimes and some 690,000 homes for older (aged 55 and over) households on lower incomes currently in the private rented sector (PRS).
According to Shelter, this 20-year programme will provide a return on investment in 39 years, and would cost £10.7bn a year on average. However by reducing the demand for housing and other benefits by reducing housing costs this would be reduced to £3.8bn a year. It isn't a part of the Shelter proposals but these savings would be significantly enhanced if these new homes were built to the zero energy standard described in this earlier post
We are now ten years on from the financial crisis, and a worsening housing crisis is affecting more and more people. Adding this to the social polarisation triggered by Brexit it is clear that we need a new political consensus. Building such a consensus around an ambitious commitment to improve social housing offers a way out of that divide.